Answer:
The aggregate demand will fall
Explanation:
The aggregate supply measures the quantity of real GDP that can be supplied by in the economy at different price levels. it measures planned output if both prices and average wage rates can change, the Long run aggregate supply curve is assumed to be vertical (this means it remains constant when the general price level changes).
The leftward shift in aggregate supply means that at the same price levels the quantity supplied of real GDP has decreased. This is mostly due to natural disasters or other supply shocks like economic depression, when there is leftward shift in aggregate there would be fewer workers available to produce goods at any given price.
Answer:
Decrease in M1; No effect on M2
Explanation:
Monetary aggregates is as follows:
M1 consists of:
= Currency with the public + Checking/Demand deposits + Other deposits with the RBI
M2 consists of:
= M1 + Post office savings account deposits
Effect on M1:
If a person transfer money from checking account to savings account, so there is a fall in M1 because the amount in checking account is reduced.
Effect on M2:
If a person transfer money from checking account to savings account, then there is a fall in checking account and at the same time there is a rise in the savings account. M1 is a component of M2.
Therefore, there will be no effect on M2.
Answer:
b. 1 pound of ice cream for Ben and 1 pound of cones for Jerry.
Explanation:
Ben and Jerry both produce ice cream. They can have comparative advantage with producing the specialized product. Ben can gain from the trade if it produces more of ice cream and less or no cones. Jerry would gain the comparative advantage if it would produce cones for the ice cream. Both of them can have comparative advantage by selling the specialized products to each other.
Invest in stock market would be based on answer d.
